All Commentary
Monday, July 1, 1985

Compulsory Bargaining Reviewed

C. W. anderson of Sun City, Arizona, is retired President of Management Resources Association of Milwaukee and past Chairman of the Institute for Humane Studies.

Congress passed the Wagner Act in 1935 with great hope that it would give employees job security and bring industrial peace on the labor-management front. Even though the results have been vastly different from the intentions, there has been no serious public examination of the premises which give justification to this law or the 1947 Taft-Hartley amendments.

The idea that compulsory collective bargaining is beneficial to employees and the public is still accepted without question by most people and is still being taught in our schools—now by unionized teachers. However, falling productivity and skyrocketing labor costs have been shaking the credibility of the claims of public benefits; higher levels of unemployment cast doubts as well on the so-called benefits for employees.

What are some of the unforeseen results of this well-meaning effort to equalize the bargaining power of the employee and the corporation?

The thousands of strikes, billions of dollars of lost pay, vicious picket line violence and destruction of property, make a mockery of the “industrial peace” objective.

Current unemployment and the relocation of thousands of employees in heavy industries to other kinds of jobs is directly related to the high labor costs (not only payroll costs but the rigidities of negotiated work rules) and the refusal of union leadership to allow local units to make concessions which might break certain “patterns.” The fact that some concessions have occurred is evidence of the severity of the economic predicament of the employees and industry. But it is important to understand that in a truly free labor market these wrenching, violent relocations would not occur; transitions would be gradual, nondisruptive.

Given the low level of public trust in unions as revealed in many opinion polls, and the declining union membership through layoffs, decertifications and losses of representation elections, it would seem that a re-evaluation is in order.

Voluntary Action Approved

To guard against misunderstanding, there is no suggestion here to eliminate voluntary collective bargaining.

Free, voluntary association is surely harmonious with economic freedom—free enterprise, if you will. When not mandated or interfered with by law, peaceful, collective action will serve as a restraint against any employer practices or policies that are excessively punitive or out of step with the realities of the surrounding labor market. It is in every employer’s self-interest to hold his most productive employees.

Does compulsory union bargaining for employees breed conflict? There is now strong evidence that in many cases it tends to. To understand why, just put yourself in the position of a union agent. Your job and your prestige depend on what you can get for the members that they believe they can’t get for themselves. So, when an employer is trying to be fair, paying as much or more than competitors, what can you as an agent do? Guess how long you’d last if you tried to be fair by telling the members they had a good employer who was doing his best to make their jobs secure.

The hard fact is that to justify your job and your union, you must attack the employer. The more wedges you can drive between the employer and the employees the more secure is your job.

It is mainly because this built-in conflict is becoming more evident that growing numbers of employees are resorting to the decertification process to rid themselves of this disruption. When business is booming and inflation permits regular increases in compensation and easy movement to other jobs, inner conflicts are much less evident. It is in slack times that it becomes apparent that the self-interest of the union hierarchy has taken precedence over the interests of employees.

This self-evident source of conflict alone is good cause for a re-examination of long accepted bargaining dogma. But, beyond the practical negatives there are other worrisome questions of principle. Space permits touching on only one—the right to own and control property in a free society. Because of the many prior legalized infringements on this right, it is now rarely defended. But those expedient compromises have taken us far down the road to the socialism (common ownership) envisioned by Karl Marx and also the British Fabian Society which, incidentally, advocated strong unions as a key factor in the breakdown of property rights.

If we accept the idea that we have a right to life, and understand that sustaining life depends on a right to own property, how can we, in principle, favor a law that violates that right? Compulsory collective bargaining demands that the owner of a business “bargain in good faith” with a union which can be elected by a small portion of the employees (only 51 percent of those voting).

Practically, “good faith” is interpreted by the National Labor Relations Board and the courts to mean making concessions and, in fact, such concessions, which may not be favored by most employees, can destroy a business. Furthermore, the employees who want to work under conditions agreed to voluntarily are legally deprived of their property right which is to contract individually for their work.

Should we be concerned about what has been happening to property rights in this effort to force collective bargaining? I think so, and I believe that millions of people in shops and offices are more than ready for a reappraisal.